Paperwork. When it comes to buying a home, you just cannot avoid it. Credit reports, home inspections, offers, loan applications, title reports, insurance…by the time you are done, you have yourself a nice little pile of paperwork. Thanks to the Consumer Financial Protection Bureau, there are big changes ahead for Jersey Shore Home Buyers. And it involves paperwork.
What is the Consumer Financial Protection Bureau (CFPB)?
Back in 2010, the CFPB was created as a result of the Dodd-Frank Wall Street Reform and Protection Act. When all hell broke loose in our country’s financial industry back in 2008, it hit every sector of the US economy. Many Americans lost their homes due to, among other things, highly risky business practices by big names in the financial industry. The CFPB was created to try to educate and protect future homeowners from falling prey to this type of thing again.
What Are the Big Changes Ahead for Jersey Shore Home Buyers?
As of August 1, 2015, the initial Truth in Lending, Good Faith Estimate, HUD-1 and final Truth in Lending forms will be a thing of the past for most Buyers. In their place will be the Loan Estimate and Closing Disclosure forms. These forms are meant to help the Buyer better understand what they are signing, what they can expect as far as costs are concerned and their options of where they can shop around for some of the services involved, such as title insurance, home warranties and debt suspension/cancellation coverage.
The Loan Estimate will now contain the potential costs the Buyer can expect with their home purchase, including title insurance, interest rate, projected monthly payment and closing costs. In the past, creditors could revise the previous forms several times before a loan closed. This caused confusion with Buyers. They will no longer be allowed to access the Loan Estimate once it has been officially compiled. The creditor must now deliver the Loan Estimate to the Buyer within three days of receiving the application. You can see what the current forms look like and what the new forms will look like after the changes are made in August at the CFPB’s website here.
There are some big changes ahead for Jersey Shore Home Buyers. Contact me if you have any questions about these changes and how they will affect your home purchase. I am more than willing to help.